Incubation of rat adipocytes with insulin results in phosphorylation and activation of a membrane-associated Type III CGMP-inhibited phosphodiesterase (CGI PDE). Activation of this specific CGI PDE is an important component in the antilipolytic action of insulin. In order to gain insight into the mechanisms for cellular regulation of this enzyme, the CDNA for the hormone-sensitive adipocyte CGI PDE was cloned from rat adipose tissue CDNA libraries. To confirm that this CDNA represents the insulin-sensitive PDE in rat adipocytes, and to examine the regulation of its enzymatic activity, full length CDNA was expressed in Baculovirus- Sf9 cell system. Several properties of the expressed CGI PDE are similar to those of the native enzyme in rat adipocytes. Expressed protein in the insect cells is present in microsomes (100,000 g,, 60 min) as is CGI PDE in rat adipocytes. Km value for the expressed protein with CAMP as substrate is 0.32 microM (Km value for native enzyme is 0.35 microM). IC50 for inhibition of the expressed protein by cilostamide is 35 Nm (IC50 of the native is 38 Nm). The molecular weight in SDS PAGE is about 140 kd (the native is about 135 kd). On Western blots, the antibody against the rat adipose tissue CGI PDE recognized the expressed protein which was phosphorylated by A-kinase in vitro. The CDNA for a human Type III CGI PDE (HFAT) was cloned from human adipose tissue CDNA libraries, human genomic libraries and by PCR amplification of human adipose tissue CDNA. We have cloned two other Type III CGI PDE CDNAS, one from a human myocardial CDNA library (HCAR) and one from rat adipose tissue CDNA (RcGIP1). The HFAT CGI PDE is more closely related to RcGIP1 than HCAR, suggesting that there is more conservation between the same Type III CGI PDE subfamily (HFAT and RcGIP1) in rat and human than between two different subfamilies (HFAT and HCAR) in the same species.